Learn why shop floor improvements will likely be invisible to accounting and why current metrics will not illustrate lean improvements. Discover how to create an alliance with accounting. Hear why your company's cost system likely promotes non-lean behavior.
The operational strategy proven to be most effective in achieving world-class performance levels is lean. Accounting must become a major participant in the lean journey. Accountants typically do not understand lean and as accounting has its own language, a significant disconnect develops between functions. Typical accounting metrics promote non-lean behavior creating a potential obstacle to a successful lean journey. Manufacturers must understand why their successful efforts at improving flow, reducing inventory, improving customer service and creating capacity will potentially lower earnings and must be able to explain this in advance of quarterly results being prepared. If these operational improvements remain invisible on financial reports, accounting will be stymied in supporting them, and the manufacturing team will be frustrated in knowing their efforts are not appreciated. To understand the strides being made during the lean conversion, manufacturing and accounting must work together to develop new metrics and plain English financial reporting. Learn how to eliminate the disconnect between accounting and operations.
Barry-Wehmiller is a 130-year-old St. Louis-based global specialty machinery manufacturer with approximately $2 billion in revenue and 8,500 associates. The company has a broad line of products serving a variety of blue chip customers in the corrugated, food, beverage, pharmaceutical, tissue and consumer products industries. The company has achieved compounded annual revenue growth of 18 percent for the past 26 years and average annual shareholder appreciation of 15 percent since 1998. www.barrywehmiller.com
With 35 years of experience, Jerry Solomon has work in a variety of industries where he has held positions of CFO and vice president of operations. He led lean transformations achieving dramatic improvements in inventory turns, lead-times, customer service, income and cash flow. Solomon has authored three lean books, Leading Lean, Who's Counting? (Shingo Award winner) and Accounting for World Class Operations (Shingo Award winner). He is a board member of the Maryland World Class Consortia and was the 2013 Maryland Lean Leader of the Year. He is also an AME examiner.